Professional Documents
Culture Documents
SECOND DIVISION
CORPORATION,
Petitioner, Present:
LEONARDO-DE CASTRO,*
BRION,
- versus - DEL CASTILLO, and
ABAD, JJ.
CANUTO A. GALIDO,
Respondent. Promulgated:
x---------------------------------------------------x
DECISION
CARPIO, J.:
The Case
The Facts
On 18 April 1966, the heirs of Domingo Eniceo, namely Rufina Eniceo and
Maria Eniceo, were awarded with Homestead Patent No. 112947 consisting of four
parcels of land located in San Isidro, Antipolo, Rizal (Antipolo property) and
particularly described as follows:
The Antipolo property with a total area of 14.8882 hectares was registered
under Original Certificate of Title (OCT) No. 535.5[5]The issuance of the homestead
patent was subject to the following conditions:
To have and to hold the said tract of land, with the appurtenances thereunto of
right belonging unto the said Heirs of Domingo Eniceo and to his heir or heirs and
assigns forever, subject to the provisions of sections 118, 121, 122 and 124 of
Commonwealth Act No. 141, as amended, which provide that except in favor of
the Government or any of its branches, units or institutions, the land hereby
acquired shall be inalienable and shall not be subject to incumbrance for a period
of five (5) years next following the date of this patent, and shall not be liable for
the satisfaction of any debt contracted prior to the expiration of that period; that it
shall not be alienated, transferred or conveyed after five (5) years and before
twenty-five (25) years next following the issuance of title, without the approval of
the Secretary of Agriculture and Natural Resources; that it shall not be
incumbered, alienated, or transferred to any person, corporation, association, or
partnership not qualified to acquire public lands under the said Act and its
amendments; x x x 6[6]
6 Id. at 79.
[6]
Petitioner alleges that when Maria Eniceo died in June 1975, Rufina Eniceo
and the heirs of Maria Eniceo (Eniceo heirs),9[9]who continued to occupy the
Antipolo property as owners, thought that the owners duplicate copy of OCT No.
535 was lost.10[10]
On 5 April 1988, the Eniceo heirs registered with the Registry of Deeds of
Marikina City (Registry of Deeds) a Notice of Loss dated 2 April 1988 of the
owners copy of OCT No. 535. The Eniceo heirs also filed a petition for the
issuance of a new owners duplicate copy of OCT No. 535 with Branch 72 of the
Regional Trial Court (RTC) of Antipolo, Rizal. The case was docketed as LRC
Case No. 584-A.11[11]
8 Id. at 64-65.
[8]
9 Id. at 81-82. The heirs of Eniceo were represented by Rufina Eniceo, daughter of
[9]
Domingo Eniceo and Leonila Bolinas, granddaughter of Domingo Eniceo and daughter
of Maria Eniceo.
10 [10]
Id. at 14.
11 [11]
Id.
On 31 January 1989, the RTC rendered a decision finding that the certified
true copy of OCT No. 535 contained no annotation in favor of any person,
corporation or entity. The RTC ordered the Registry of Deeds to issue a second
owners copy of OCT No. 535 in favor of the Eniceo heirs and declared the original
owners copy of OCT NO. 535 cancelled and considered of no further value.12[12]
Petitioner states that as early as 1991, respondent knew of the RTC decision
in LRC Case No. 584-A because respondent filed a criminal case against Rufina
Eniceo and Leonila Bolinas (Bolinas) for giving false testimony upon a material
fact during the trial of LRC Case No. 584-A.14[14]
12 Id. at 81-82.
[12]
13 [13]
Id. at 80 (reverse side).
14 Id. at 62-66. In this decision dated 15 May 1998, Rufina Eniceo and Leonila Bolinas
[14]
were acquitted.
Petitioner alleges that sometime in February 1995, Bolinas came to the
office of Alberto Tronio Jr. (Tronio), petitioners general manager, and offered to
sell the Antipolo property. During an on-site inspection, Tronio saw a house and
ascertained that the occupants were Bolinas relatives. Tronio also went to the
Registry of Deeds to verify the records on file. Tronio ascertained that OCT No.
535 was clean and had no lien and encumbrances. After the necessary verification,
petitioner decided to buy the Antipolo property.15[15]
On the same date, Transfer Certificate of Title (TCT) Nos. 277747 and
277120 were issued. TCT No. 277747 covering lots 1 and 5 of the Antipolo
property was registered in the names of Rufina Eniceo, Ambrosio Eniceo, Rodolfo
Calove, Fernando Calove and Leonila Calove Bolinas.18[18]TCT No. 277120
15 Id. at 15-16.
[15]
17 Id. at 115-118.
[17]
18 Id. at 119.
[18]
covering lots 3 and 4 of the Antipolo property was registered in the name of
petitioner.19[19]
On 5 April 1995, the Eniceo heirs executed another deed of sale in favor of
petitioner covering lots 1 and 5 of the Antipolo property for P1,000,000. TCT No.
278588 was issued in the name of petitioner and TCT No. 277120 was cancelled. 20
[20]
On 16 January 1996, respondent filed a civil complaint with the trial court
against the Eniceo heirs and petitioner. Respondent prayed for the cancellation of
the certificates of title issued in favor of petitioner, and the registration of the deed
of sale and issuance of a new transfer certificate of title in favor of respondent.22[22]
19 Id. at 123.
[19]
21 Id. at 32.
[21]
22 Id. at 17.
[22]
On 4 July 2000, the trial court rendered its decision dismissing the case for
lack of legal and factual basis.23[23]
Aggrieved by the CAs decision and resolution, petitioner elevated the case
before this Court.
The trial court stated that although respondent claims that the Eniceo heirs
sold to him the Antipolo property, respondent did not testify in court as to the
existence, validity and genuineness of the purported deed of sale and his
possession of the duplicate owners copy of OCT No. 535. The trial court stated
that as owner of a property consisting of hectares of land, respondent should have
23 Id. at 142.
[23]
24 Id. at 37.
[24]
come to court to substantiate his claim and show that the allegations of the Eniceo
heirs and petitioner are mere fabrications.25[25]
The trial court noticed that respondent did not register the deed of sale with
the Register of Deeds immediately after its alleged execution on 10 September
1973. Further, respondent waited for 22 long years before he had the sale approved
by the DENR Secretary. The trial court declared that respondent slept on his rights.
The trial court concluded that respondents failure to register the sale and secure the
cancellation of OCT No. 535 militates against his claim of ownership. The trial
court believed that respondent has not established the preponderance of evidence
necessary to justify the relief prayed for in his complaint.26[26]
The trial court stated that Bolinas was able to prove that the Eniceo heirs
have remained in actual possession of the land. The filing of a petition for the
issuance of a new owners duplicate copy requires the posting of the petition in
three different places which serves as a notice to the whole world. Respondents
failure to oppose this petition can be deemed as a waiver of his right, which is fatal
to his cause.27[27]
The trial court noted that petitioner is a buyer in good faith and for value
because petitioner has exercised due diligence in inspecting the property and
verifying the title with the Register of Deeds.28[28]
25 Id. at 139-140.
[25]
26 Id. at 140.
[26]
27 Id. at 140-141.
[27]
28 Id. at 141.
[28]
The trial court held that even if the court were to believe that the deed of sale
in favor of respondent were genuine, still it could not be considered a legitimate
disposition of property, but merely an equitable mortgage. The trial court stated
that respondent never obtained possession of the Antipolo property at any given
time and a buyer who does not take possession of a property sold to him is
presumed to be a mortgagee only and not a vendee.29[29]
The CA ruled that the deed of sale in favor of respondent, being a notarized
document, has in its favor the presumption of regularity and carries the evidentiary
weight conferred upon it with respect to its due execution. The CA added that
whoever asserts forgery has the burden of proving it by clear, positive and
convincing evidence because forgery can never be presumed. The CA found that
petitioner and the Eniceo heirs have not substantiated the allegation of forgery.30[30]
The CA pointed out that laches has not set in. One of the requisites of
laches, which is injury or prejudice to the defendant in the event relief is accorded
to the complainant or the suit is not held to be barred, is wanting in the instant case.
The CA added that unrecorded sales of land brought under the Torrens
system are valid between parties because registration of the instrument is
merely intended to bind third persons.31[31]
29 Id.
[29]
30 Id. at 34.
[30]
31 Id. at 34-35.
[31]
32 Id. at 35.
[32]
33 Id. at 35-36.
[33]
34 Id. at 36.
[34]
The CA stated that the execution of the notarized deed of sale, even
without actual delivery of the disputed properties, transferred ownership
from the Eniceo heirs to respondent. The CA held that respondents possession
of the owners duplicate copy of OCT No. 535 bolsters the contention that the
Eniceo heirs sold the disputed properties to him by virtue of the questioned
deed.35[35]
The CA reversed the trial courts decision. The dispositive portion of the CA
decision reads:
35 Id. at 36-37.
[35]
36 Id. at 37.
[36]
The Issues
37 [37]
Id. at 19.
38 [38]
Id. at 23.
The contract between the Eniceo heirs and respondent executed on 10
September 1973 was a perfected contract of sale. A contract is perfected once
there is consent of the contracting parties on the object certain and on the
cause of the obligation.39[39]In the present case, the object of the sale is the
Antipolo property and the price certain is P250,000.
The contract of sale has also been consummated because the vendors and
vendee have performed their respective obligations under the contract. In a
contract of sale, the seller obligates himself to transfer the ownership of the
determinate thing sold, and to deliver the same to the buyer, who obligates himself
to pay a price certain to the seller.40[40]The execution of the notarized deed of sale
and the delivery of the owners duplicate copy of OCT No. 535 to respondent is
tantamount to a constructive delivery of the object of the sale. In Navera v. Court
of Appeals, the Court ruled that since the sale was made in a public instrument, it
was clearly tantamount to a delivery of the land resulting in the symbolic
possession thereof being transferred to the buyer.41[41]
Petitioner alleges that the deed of sale is a forgery. The Eniceo heirs also
claimed in their answer that the deed of sale is fake and spurious.42[42]However, as
correctly held by the CA, forgery can never be presumed. The party alleging
forgery is mandated to prove it with clear and convincing evidence. 43[43]Whoever
42 Rollo, p. 32.
[42]
Petitioner invokes the belated approval by the DENR Secretary, made within
25 years from the issuance of the homestead, to nullify the sale of the Antipolo
property. The sale of the Antipolo property cannot be annulled on the ground that
the DENR Secretary gave his approval after 21 years from the date the deed of sale
in favor of respondent was executed. Section 118 of Commonwealth Act No. 141
or the Public Land Act (CA 141), as amended by Commonwealth Act No. 456,44
[44]
reads:
44 [44]
CA No. 456 was approved on 8 June 1939.
45 [45]
Now Secretary of Environment and Natural Resources.
46 [46]
452 Phil. 178, 201-202 (2003).
Equitable Mortgage
In Lim v. Calaguas,49[49]the Court held that in order for the presumption of
equitable mortgage to apply, there must be: (1) something in the language of the
contract; or (2) in the conduct of the parties which shows clearly and beyond doubt
that they intended the contract to be a mortgage and not a pacto de retro sale.50
[50]
Proof by parol evidence should be presented in court. Parol evidence is
admissible to support the allegation that an instrument in writing, purporting on its
face to transfer the absolute title to property, was in truth and in fact given merely
as security for the payment of a loan. The presumption of equitable mortgage
under Article 1602 of the Civil Code is not conclusive. It may be rebutted by
competent and satisfactory proof of the contrary.51[51]
48 Id. at 389-390.
[48]
51 Sps. Austria v. Sps. Gonzales, Jr., 465 Phil. 355, 365 (2004).
[51]
an existing debt by way of mortgage. In fact, mere tolerated possession is not
enough to prove that the transaction was an equitable mortgage.52[52]
Furthermore, petitioner has not shown any proof that the Eniceo heirs were
indebted to respondent. On the contrary, the deed of sale executed in favor of
respondent was drafted clearly to convey that the Eniceo heirs sold and transferred
the Antipolo property to respondent. The deed of sale even inserted a provision
about defrayment of registration expenses to effect the transfer of title to
respondent.
52 Redondo v. Jimenez, G.R. No. 161479, 18 October 2007, 536 SCRA 639, 645.
[52]
53 Rollo, p. 218. Article 1605 of the Civil Code provides: In the cases referred to in
[53]
Articles 1602 and 1604, the apparent vendor may ask for reformation of the instrument.
55 Id. at 419.
[55]
Brief56[56]filed before the CA that the Eniceo heirs claimed as an alternative defense
that the deed should be presumed as an equitable mortgage.
56 CA rollo, p. 134.
[56]
58 G.R. No. 92310, 3 September 1992, 213 SCRA 563, 565-566 (1992).
[58]
Petitioner does not dispute that respondent registered his adverse claim with
the Registry of Deeds on 14 March 1995. The registration of the adverse claim
constituted, by operation of law, notice to the whole world. 62[62]From that date
onwards, subsequent buyers were deemed to have constructive notice of
respondents adverse claim.
62 Section 52 of the Property Registration Decree (PD No. 1529) provides as follows:
[62]
Laches
Respondent discovered in 1991 that a new owners copy of OCT No. 535
was issued to the Eniceo heirs. Respondent filed a criminal case against the Eniceo
heirs for false testimony. When respondent learned that the Eniceo heirs were
planning to sell the Antipolo property, respondent caused the annotation of an
adverse claim. On 16 January 1996, when respondent learned that OCT No. 535
was cancelled and new TCTs were issued, respondent filed a civil complaint with
the trial court against the Eniceo heirs and petitioner. Respondents actions negate
petitioners argument that respondent is guilty of laches.
True, unrecorded sales of land brought under Presidential Decree No. 1529
or the Property Registration Decree (PD 1529) are effective between and binding
only upon the immediate parties. The registration required in Section 51 of PD
1529 is intended to protect innocent third persons, that is, persons who, without
knowledge of the sale and in good faith, acquire rights to the property. 67[67]
Petitioner, however, is not an innocent purchaser for value.
SO ORDERED.
ANTONIO T. CARPIO
ASSOCIATE JUSTICE
WE CONCUR:
J. LEONARDO-DE CASTRO
ASSOCIATE JUSTICE
ROBERTO A. ABAD
ASSOCIATE JUSTICE
ATTESTATION
I ATTEST THAT THE CONCLUSIONS IN THE ABOVE DECISION
HAD BEEN REACHED IN CONSULTATION BEFORE THE CASE WAS
ASSIGNED TO THE WRITER OF THE OPINION OF THE COURTS
DIVISION.
ANTONIO T. CARPIO
Associate Justice
Chairperson
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, and the Division
Chairpersons Attestation, I certify that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice